Investor loss at NSE mounts to Sh130bn in just two sessions

Tuesday, September 5, 2017 8:56

By CHARLES MWANIKI

The Nairobi Securities Exchange. FILE PHOTO | NMG

Investor wealth at the Nairobi Securities Exchange (NSE) #ticker:NSE fell a further Sh38 billion Monday as the bourse continued to reel from aftershocks of nullification of the presidential poll by the Supreme Court Friday.

Pension funds, whose equity investments recently rose to 21.5 per cent, and insurers are expected to take major hits.

The cumulative erosion of market capitalisation at the exchange has hit Sh130 billion in just two trading sessions, with the bourse having shed Sh92 billion on Friday as it reacted sharply to the destabilising news.

Market capitalisation now stands at Sh2.349 trillion, down from Sh2.479 trillion at the close of trading on Thursday last week.

Investors, mainly foreigners, continued selling off shares largely on blue chip counters which carry heavier weight on the main indices.

Mostly foreigners

The uncertain political climate saw the benchmark NSE 20-share index shed 80 points Monday to close at 3,806 points, while the All Share Index closed 2.6 points lower at 160.3 points.

“Most sellers were foreigners selling Safaricom, #ticker:SCOM Bamburi #ticker:BAMB and Equity Bank,#ticker:EQTY just like they did on Friday. The foreign investors accounted for 74 per cent of total market activity,” said Genghis Capital analyst Grace Wangeci.

“Local investors were buying but not strongly, as they were waiting to see the way forward on the political front. We expect, however, that the market will stabilise before the end of the week.”

Total equity turnover at the bourse remained high at Sh1.68 billion compared to Friday’s Sh1.64 billion.